Self-protection, insurance demand and cost-sharing strategy under mean-variance preferences

Key Points

• Insurance demand is influenced by individuals' self-protection measures and risk aversion strategies.
• Individuals adopting mean-variance preferences demonstrate significant variations in insurance demand related to their risk assessments.
• The study employs a theoretical model to analyze the interplay between self-protection and insurance choices under varying risk conditions.
• Findings highlight the importance of understanding cost-sharing in managing financial risks and insurance effectiveness.